1 2 AGREEMENT AND PLAN OF MERGER BETWEEN NATIONAL ASSOCIATION OF INDEPENDENT FEE APPRAISERS, INC. AND AMERICAN SOCIETY OF APPRAISERS
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1 AGREEMENT AND PLAN OF MERGER BETWEEN NATIONAL ASSOCIATION OF INDEPENDENT FEE APPRAISERS, INC. AND AMERICAN SOCIETY OF APPRAISERS THIS AGREEMENT AND PLAN OF MERGER by and between the National Association of Independent Fee Appraisers, Inc., an Arizona nonprofit corporation ( NAIFA ) and the American Society of Appraisers, a Delaware nonstock corporation ( ASA ) (NAIFA and ASA are sometimes referred to herein as the Constituent Corporations ) is dated October 8, WHEREAS, NAIFA is a nonprofit corporation duly organized and existing under the laws of the State of Arizona and ASA is a nonstock corporation duly organized and existing under the laws of the State of Delaware and both corporations are exempt from federal income tax under Section 501(c)(6) of the Internal Revenue Code; WHEREAS, the governing bodies of each of the Constituent Corporations has determined that it is advisable and in the best interests for NAIFA to be merged with and into ASA, with ASA being the surviving corporation; WHEREAS, the Constituent Corporations agree that this Agreement and Plan of Merger contains all of the terms, conditions, covenants, representations and warranties of each of the Constituent Corporations as are customary for transactions of the nature and size of the merger and constitutes the Definitive Agreement contemplated by the Constituent Corporations Memorandum of Understanding dated April 18, 2017; and WHEREAS, each of the Constituent Corporations will have their respective Boards of Directors and Membership vote on the approval of this Agreement and Plan of Merger. THEREFORE, the parties to this Agreement and Plan of Merger, in consideration of the mutual covenants, agreements and provisions hereinafter contained do hereby prescribe the terms and conditions of said merger and mode of carrying the same into effect as follows: 1. Approval of Merger (a) (b) The Board of Directors and members of NAIFA have approved this Agreement and Plan of Merger in accordance with the Arizona Nonprofit Corporation Act ( Arizona Act ). The Board of Governors and members of ASA have approved this Agreement and Plan of Merger in accordance with the General Corporation Law of the State of Delaware ( Delaware Act ).
2 Merger. As of the Effective Date (as such term is defined hereinbelow) of the merger, the separate existence of NAIFA shall cease and NAIFA shall be merged with and into ASA (the Merger ), such that ASA shall continue its corporate existence and be the corporation surviving the Merger. ASA, as it will exist following the Merger, is sometimes hereinafter referred to as the Surviving Corporation. 3. Effective Date. The Merger shall become effective on July 1, 2018 or such other date as the Constituent Corporations shall together agree and complete the filing of a Plan of Merger with the Arizona Corporation Commission and a Certificate of Merger with the Delaware Secretary of State, as required by the Arizona Act and the Delaware Act, respectively, and after satisfaction of the requirements of the laws of the State of Arizona and the State of Delaware (the Effective Date ). 4. Terms of Merger. The terms and conditions of the Merger are as follows: (a) (b) (c) (d) (e) Name. Following the Effective Date, the name of the Surviving Corporation shall remain the American Society of Appraisers. Principal Office. Following the Effective Date, the principal office of the surviving corporation shall be located at Sunset Hills Road, Suite 310, Reston, Virginia, Certificate of Incorporation. The Certificate of Incorporation of ASA shall be and remain the Certificate of Incorporation of the Surviving Corporation until amended in accordance with the Delaware Act. Constitution. As of the Effective Date, the Constitution of ASA ( Constitution ) shall be and remain the Constitution of the Surviving Corporation until amended in accordance with the terms thereof and the Delaware Act. Bylaws. As of the Effective Date, the Bylaws and Administrative Rules of ASA ( Bylaws ) shall be and remain the Bylaws of the Surviving Corporation, amended as follows: The ASA Real Property Committee shall become the Real Property - NAIFA Committee,. (ii) Administrative Rule XV, Section 1(D)(1) shall be revised to read as follows: Any candidate nominated for international office must be a qualified Accredited Senior Appraiser or Fellow, or reciprocal equivalent thereof, who has served as a regional governor, discipline governor, or chair of an international committee, or as an officer or director of an entity that has merged into, and with, the Society. All other provisions of the Bylaws shall remain in full force and effect until amended in accordance with the terms thereof and Delaware law. Adoption of the
3 (f) (g) Bylaws shall not be deemed to be inconsistent with the special appointments set forth in Section 4(g) below. Rules of Procedure. As of the Effective Date, the Organizational Structure and Rules of Procedure of the ASA Real Property Committee shall become the Organizational Structure and Rules of Procedure of the Surviving Corporation s Real Property -NAIFA Committee (the Real Property -NAIFA Committee Rules of Procedure ), amended as follows: The last sentence of Article II, Section 6 shall be revised to read as follows: Only a current member, current officer, or past chair of the NAIFA Committee holding an ASA Senior designation or its reciprocal equivalent in good standing, or a former officer or director of an entity that has merged into, and with, the Society shall be eligible for election as Discipline Governor. All other provisions of the Rules of Procedure shall remain in full force and effect until amended in accordance with the terms thereof, the Bylaws, and Delaware law. Adoption of the Real Property -NAIFA Committee Rules of Procedure shall not be deemed to be inconsistent with the special appointments set forth in Section 4(g) below. Governance. From and after the Effective Date: The officers of the Real Property-NAIFA Committee shall be the individuals holding the following positions immediately prior to the Effective Date: (1) Chair: NAIFA President (2) Vice Chair: Chair of the ASA Real Property Committee (3) Secretary-Treasurer: NAIFA President-Elect (4) Immediate Past Chair: Immediate Past Chair of the ASA Real Property Committee Such individuals shall serve their respective NAIFA terms ending June 30, 2018 or, if earlier, until their successors are elected and qualified. In the event any of the individuals appointed is unable to complete a full term, the Former NAIFA Directors shall appoint a successor to fill the vacancy in the office of Chair or Secretary-Treasurer for the remainder of the term (ending June 30, 2018), and the individuals who make up the Board of Governors of ASA shall appoint a successor to fill the vacancy in the office of Vice Chair or Immediate Past Chair for the remainder of the term (ending June 30, 2018).
4 (ii) (iii) The members of the Real Property -NAIFA Committee shall consist of the following: (1) Six (6) individuals who served on the ASA Real Property Discipline Committee and are selected by the ASA Board of Governors immediately prior to the Effective Date, of whom two (2) shall serve a one-year term, two (2) shall serve a two-year term, and two (2) shall serve a three-year term; and (2) Six (6) Former NAIFA Directors selected by the NAIFA Board of Directors immediately prior to the Effective Date, of whom two (2) shall serve a one-year term, two (2) shall serve a two-year term, and two (2) shall serve a three-year term. (3) In addition, those Former NAIFA Directors and members of the ASA Real Property Discipline Committee who served immediately prior to the Effective Date, but have not been appointed to a voting position on the Real Property -NAIFA Committee, either as an officer or a Committee member, may, at their choosing, serve as non-voting members of the Committee. In the event any of the individuals appointed is unable to complete a full term, the Former NAIFA Directors shall appoint a successor to fill the vacancy among the NAIFA appointees for the remainder of the term, and the Board of Governors of ASA shall appoint a successor to fill the vacancy among the ASA appointees for the remainder of the term. All other current directors and officers of ASA shall be and remain the directors and officers of the Surviving Corporation. 138 (h) Designations/Accreditations From and after the Effective Date, the Surviving Corporation shall maintain NAIFA Designations as these designations are defined in Section 2.1 of the National Association of Independent Fee Appraisers Standing Rules ( NAIFA Standing Rules ). Specifically: (1) Any individual who was a Designated Member of NAIFA in good standing immediately prior to the Effective Date may continue to use the Designation he or she earned from NAIFA and shall be eligible to apply for, and earn, an ASA Designation, under the terms of the existing Reciprocal Agreement, provided he or she meets the requirements that were in place for such Designation immediately prior to the Effective Date. (2) Any individual who applied for a NAIFA Designation prior to the Effective Date may earn and use such Designation upon meeting the requirements that were in place immediately prior to the Effective
5 Date. After the Effective Date, no further NAIFA Designation applications will be accepted. Membership. From and after the Effective Date, each member in good standing of NAIFA immediately prior the Effective Date shall be and constitute a member in good standing of the Surviving Corporation as follows: (ii) (iii) Designated Members of NAIFA may become Accredited Members of the Surviving Corporation under the category of Accreditation that corresponds to their Designation as set forth in the Reciprocal Agreement. Associate Members of NAIFA shall become Candidates of the Surviving Corporation. Candidate Members of NAIFA shall become Candidates of the Surviving Corporation, provided that following the merger, all NAIFA Candidates who are working toward a designation with NAIFA as of July 1, 2018 shall be permitted to complete the necessary steps to attain the NAIFA designation provided that the NAIFA designation is achieved by the Candidate prior to the date that NAIFA can exercise the right of withdrawal pursuant to Section 4 (m) of the MOU; (j) (iv) Honorary Members of NAIFA shall become Honorary Members of the Surviving Corporation; (v) Life Members of NAIFA shall become Life Members of the Surviving Corporation; and (vi) Retired Members of NAIFA shall become Retired Members of the Surviving Corporation. Membership Dues Transition. From and after the Effective Date, those members of NAIFA who become members of the Surviving Corporation as a result of the Merger shall be required to pay ASA dues as follows: (a) Retired Members - $50 for all retired members effective July 1, 2018 (b) NAIFA Partially Retired Members on July 1, $250 effective January 1, 2019; $300 effective January 1, 2020; and $315 effective January 1, (All members who partially retire on July 2, 2018 and after shall pay dues of $315). (c) Life Members - $0 for all Life members effective July 1, 2018
6 (k) (d) IFA, IFAA, IFAS, IFAC - $499 effective January 1, 2019; $549 effective January 1, 2020; and $630 effective January 1, (All members who are accredited ASA on July 1, 2018 and after shall pay dues of $630). (e) NAIFA Candidate - $450 effective January 1, 2019; $500 effective January 1, 2020; and $545 effective January 1, (All persons becoming Candidates on or after July 1, 2018 shall pay dues of $525). (f) Applicant - $490 for all Applicants effective July 1, (g) Affiliate - $285 for all Affiliates effective July 1, (h) Chapter Dues - $15 for all members effective July 1, In addition, ASA Chapters may request an additional dues assessment to the ASA Board of Governors. Some ASA Chapters have approved assessments. Other: ASA Connoisseur $285; ASA Student $25. Fee for Dual Membership. The administrative fee for both ASA and NAIFA members who elect to have both an ASA designation and a NAIFA designation is $50 annually (l) Chapters. Chapters will merge according to the recommendations of the Constituent Corporations joint task force (m) (n) Education. After the Effective Date, the Surviving Corporation shall establish a task force composed of representatives of the Constituent Corporations to evaluate the content and delivery mechanisms for education available to the Surviving Corporation and make recommendations to the Real Property -NAIFA Committee regarding a schedule of integrated course offerings. Assets and Liabilities. From and after the Effective Date of the Merger, the Surviving Corporation shall possess all the rights, privileges, immunities, and franchises of a public, as well as of a private nature, of each of the Constituent Corporations; and all property, real, personal and mixed, and all debts due on whatever account, including subscriptions to shares and all other causes in action, and all and every other interest, of or belonging to or due to each of the Constituent Corporations, shall be taken and deemed to be transferred to and vested in the Surviving Corporation without further act or deed; and the title to any real estate, or any interest therein, vested in any of the Constituent Corporations shall not revert or be in any way impaired by reason of the Merger, provided, however, that the Surviving Corporation shall thenceforth be responsible and liable for all the liabilities and obligations of each of the Constituent Corporations, and any claim existing or action or proceeding pending by or against either of the Constituent Corporations may be prosecuted to judgment as if the Merger had not taken place, or the Surviving Corporation may be substituted in its place, and neither the rights
7 of creditors nor any liens upon the property of either of the Constituent Corporations shall be impaired by the Merger. Without limiting the generality of the foregoing, the Constituent Corporations acknowledge and agree as follows: Following the Effective Date, the Surviving Corporation may utilize NAIFA s name, logo, and service marks (collectively, NAIFA Marks ) in conjunction with activities of the Real Property -NAIFA Committee and shall preserve and maintain ownership of the NAIFA Designations in a manner consistent with the purposes set forth in Section 4(h) above (o) (ii) The Constituent Corporations shall take all steps necessary to transfer ownership of the following domain names held by NAIFA to the Surviving Corporation following the Effective Date: (iii) The Surviving Corporation may maintain a Real Property-NAIFA Committee Web site and may utilize one or more of the following URLs for such purpose: Right of Withdrawal (ii) From and after the Effective Date, the 2017 NAIFA Directors and Officers who are members in good standing with ASA as of the time that the right of withdrawal is exercised, shall have the right, at any time within the threeyear period following the Effective Date, to call for NAIFA s withdrawal from the Merger, and form a new not-for-profit corporation to represent the interests of independent fee appraisers (the Withdrawal ), provided that such Withdrawal is approved by a 2/3 vote of the 2017 NAIFA Directors and Officers. For more certainty the 2017 NAIFA Officers and Directors are: Dave Doering, IFA; Robert Luciani, IFA; Molly Orman, IFA; Mike Cordell, IFA; Chuck Blau, IFAC; Joni Cook, IFA; Mark R. Evans, IFAS; Nena W. Henderson, IFA; Jerry Jones, IFA; Mike Lange, SR IFAC; Bob Solotist, IFA; Ronald J. Zeike, Jr. IFA; and Louis A. Bonato, IFA. In the event of a Withdrawal, the Surviving Corporation shall: (1) Transfer ownership of the NAIFA Designations, NAIFA Marks, NAIFA Domain Names, and Real Property-NAIFA Committee Web site content to such new corporation as of the date of the Withdrawal; (2) Transfer to such new corporation as of the date of the Withdrawal an amount equal to the amount in NAIFA s reserves as of the Effective Date ( NAIFA Funds ). For purposes of this Agreement, reserves shall mean the funds identified as reserves in NAIFA s financial records immediately prior to the Effective Date. Notwithstanding the foregoing, the new corporation shall be responsible for all costs and expenses associated with the Withdrawal, including, without
8 (p) limitation, filing fees, legal fees, copying costs, staff time, etc., and the Surviving Corporation may deduct such costs and expenses from the NAIFA Funds before they are transferred to the new corporation. Service of Process. The Surviving Corporation hereby consents that it may be sued and served with process in the State of Delaware in any proceeding for the enforcement of any obligation of NAIFA, and NAIFA irrevocably appoints the Corporations Commission of the State of Arizona as its agent to accept service of process in any such proceeding (q) Abandonment of Merger. Anything herein or elsewhere to the contrary notwithstanding, this Agreement and Plan of Merger may be abandoned by the mutual consent of the Constituent Corporations, evidenced by appropriate resolutions of their respective Boards of Directors, at any time prior to the filing of the Plan of Merger with the Arizona Corporation Commission and the filing of the Certificate of Merger with the Delaware Secretary of State. 5. Insurance. Prior to the Effective Date, ASA shall secure a tail policy for directors and officers insurance covering the officers and directors of NAIFA prior to the Effective Date. Such policy shall provide coverage comparable to that which NAIFA currently maintains. 6. Authority of Officers and Directors. The proper officers and directors of the Constituent Corporations shall execute and deliver all such documents and take all such actions as may be necessary or advisable, or as may be requested by the Surviving Corporation from time to time, in order to vest fully all the property rights of the Constituent Corporations in the Surviving Corporation and otherwise carry out the intent of this Agreement and Plan of Merger and the transactions contemplated hereby. 7. Governing Law. The interpretation and enforcement of this Agreement and Plan of Merger shall be governed by the laws of the State of Delaware
9 IN WITNESS WHEREOF, each of NAIFA and ASA has executed this Agreement and Plan of Merger as of the date set forth above. NATIONAL ASSOCIATION OF INDEPENDENT FEE APPRAISERS, INC. an Arizona nonprofit corporation By: President AMERICAN SOCIETY OF APPRAISERS a Delaware nonstock corporation By: International President
MEMORANDUM OF UNDERSTANDING REGARDING THE PROPOSED
1 2 3 4 5 6 7 8 9 MEMORANDUM OF UNDERSTANDING REGARDING THE PROPOSED AGREEMENT AND PLAN OF MERGER BETWEEN NATIONAL ASSOCIATION OF INDEPENDENT FEE APPRAISERS, INC. AND AMERICAN SOCIETY OF APPRAISERS 10
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